What happens to a divorce judgment if the parties reconcile?
In some of my cases, the parties reconcile after the divorce is over. If the parties reconcile this can be interpreted as revocation of the prior divorce judgment. Reconciliation occurs when spouses resume living together for a sufficient period of time, which leaves the court to conclude that the parties resolved their differences and agree to resume their marital relationship. In many cases, a court may view a reconciliation as voiding the executory sections of the divorce judgment. However, the executed portions of the divorce judgment will remain unaffected.
The concept of reconciliation can be very important if one spouse has obtained unfavorable terms in their divorce. Sometimes, real estate market conditions change, or stock values plummet. If a devious spouse convinces a lovelorn ex-spouse to reconcile, it may very well be a ploy to try to have the remaining executory terms of the divorce judgment declared null and void.
What if I purchased a house prior to marriage, and I used nothing but my own premarital funds to purchase the house. The property was titled in my name alone. After we married, I agreed to re-deed the home over to the both of us as tenants by the entireties. What then?
In most cases, the deeding over would be regarded as evidence of an inter-marital gift of one-half of the property to the previously non-titled spouse.
Can a spouse recover a down payment for the purchase of the marital home, if the marriage is a "quickie"?
In many cases, one spouse usually the husband comes into the marriage with the money. Quite frequently, one spouse pays for the deposit to purchase the marital home. In some cases, the marriage is a disaster, and the marriage only lasts a year or two. A frequent issue is whether the richer spouse can recover his deposit monies that were used to purchase the home.
Unfortunately, even though only one spouse paid for most of the deposit, the courts will view this as an implied gift to the other spouse. Therefore, the court will view the entire down-deposit as a marital asset. The court will consider that the down-payment was a gift to the other spouse, and it was made in contemplation of marriage. In summary, once a spouse makes a down-payment on a marital home, then this money is immediately converted into a marital assets, and it must be equally split in a divorce.
How is the marital debt distributed during the marriage?
In many divorce cases, the issue really is not the distribution of marital assets. Instead it is the distribution of credit card debt, car-repo debt, tax debt, and paying off mortgage arrears. The bottom line is New Jersey is a very expensive state to survive in. Property taxes are sickening. Tolls are high. Food is expensive. Even just going to the beach will cost you almost $10. What a rip off! Jersey is the only state besides New York to charge to get onto the beach. Let's face it, many aspects of living in New Jersey suck.
In about one half of my cases, the primary issue is how can the parties split up the debt that was accumulated during the marriage. The basic rule is that any debts that were accumulated during the marriage must be allocated between the parties. However, a court may consider who has a greater income and proportion the debts accordingly.
I always recommend that marital assets be sold, and that as much of the marital debt be paid off. I always recommend that the assets be sold or liquidated as soon as possible after the divorce is over. In many cases, I recommend that the marital home be sold, and that any outstanding credit cards be paid off from the proceeds of the closing. I also counsel my clients that they should not pay full value to the credit card companies. I always recommend that I be retained to obtain a "work out agreement" of the credit card debt. In many cases, I can work out a deal with the credit card company to settle their claims for 40% to 50% of the outstanding credit card bill(s). However, the credit card company must be paid the full amount of the settlement from the closing. In return, the credit card company will waive the remaining balance, and they will mark the debt as a "paid settlement in full" on the parties credit reports. This is a great service that I can provide to recently divorced couples, who are in financial trouble.
It is never a good idea to just split up the credit card debts. In many cases, the parties just do not honor the terms of the judgment of divorce. In many cases, one spouse will eventually declare bankruptcy, and he/she will not honor the terms of the judgment of divorce to pay off certain credit card debts. Once the credit card debt is discharged by one spouse, then the credit card company will pursue the collection of this debt against the other spouse. If the other spouse co-signed on the credit card application, then he/she could be liable for this consumer debt even if the judgment of divorce specified otherwise.
In summary, the issue of outstanding credit card debts is very common in most divorces. Great care should be given to insuring that the debts are paid off as soon as possible with the liquidation of some marital assets. If this is not possible, then great care should be given to determining if both spouses are listed on the credit card application as co-debtors. A litigant must always be mindful that if their spouse files for bankruptcy, then the credit card company may go hunting for you if your beloved ex-spouse filed for a bankruptcy.
I also always advise my clients to get their names removed from any car loans as soon as the divorce is over. I have heard many horror stories as to how a person has had his credit ruined because he co-signed on his ex-wife's auto loan, and how she failed to make the payments. Please also be mindful that deficiency judgments for defaulted auto loans are also outrageously high.
Finally, it is also imperative that a person removes their name from any mortgage ASAP after the divorce. It is very common for the spouse who still lives in the marital home to default on the mortgage. Guess what? If your name is still on the mortgage, even if you are no longer on the deed, you will still be named as a defendant in a foreclosure suit if one is filed. This will nuke your credit, and you won't be able to purchase a new home, because you will not be able to obtain a mortgage.
In summary, in many cases, the distribution of debt is as important or more important than the distribution of assets. Don't trust your ex. Follow up on him or her. Make sure that the mortgage is refinanced and your name is taken off. Call the auto finance company and make sure that your ex-spouse is paying the monthly car bill if you can't get your name off as a co-signer. Finally, try to separate the credit card bills, and try to pay off as much of them as possible. Don't let joint credit card bills linger. They will ultimately haunt you.
Can I blow off my obligations to my ex-spouse by filing for bankruptcy?
Bankruptcy and divorce really go together like ham and eggs, Batman and Robin, and bad girlfriends and headaches. This topic really deserves a whole set of FAQ's. Eventually, I will write an entire set of FAQ's on the impact of bankruptcy on family law.
In summary, child support and alimony can't be discharged in bankruptcy. A spouse can't wipe off his child support and alimony obligations by filing for bankruptcy. However, a devious ex-spouse may have a small opening to try to discharge some of the debts to his/her spouse that were created by the equitable distribution aspects of the divorce. If a person files for bankruptcy, and if he tries to discharge debts to his spouse, then there is a possibility that this debt could be discharged in bankruptcy. The dependent person must object to the discharge of a non-support debt in bankruptcy court. The bankruptcy court will then hold a hearing to determine the dischargeability of the debts. It will consider whether the debtor has the ability to cover the debt with income of property which is not necessary for his or her support or for the support of the dependent, such as a spouse or child. Furthermore, the bankruptcy court will balance the benefit of paying the debt with the detrimental consequences of not paying the debt.
What is an antenuptial agreement?
An antenuptial agreement is one made prior to the parties' marriage. It disposes of property and alimony rights to a spouse in the event that a marriage should fail. Normally, the intent of an antenuptial agreement is to deny a spouse an interest in assets held in the full name of the other at the time of the marriage. By executing an agreement, the parties have agreed not to allow the court to resolve questions of alimony and equitable. Distribution. These agreements are enforceable provided that there is full disclosure both parties as to their financial conditions, including assets and income. The agreement is null and void if one spouse is left destitute. An agreement which leaves one souse with a standard of living far below which was enjoyed during the marriage may not be upheld by the court. The courts will also make sure that there is no fraud or duress in the execution of the agreement.
Are professional degrees subject to equitable distribution?
In many cases, a very valuable assets is a professional degree. In many cases, a devoted wife or husband helps pay for a law degree or a medical degree for their husband. I am certain that many people have heard of the common case wherein the devoted wife spouse is a nurse, and she works her tail off to pay for her husband to go to medical school. Once the wife's looks wear off, it is not uncommon for the husband/doctor to become a playboy.
A medical degree and a license or other professional degree is not an asset that is subject to equitable distribution. Instead, the courts deal with this issue in the context of alimony rather than in equitable distribution. The courts realize that there are too many problems associated with value and worth of a professional degree. A professional degree, for purposes of property distribution, are nothing more than a possibility of enhanced earnings. It is not considered property because it cannot be sold. Its value cannot be readily determined. Instead, the court will consider the needs of the spouse who does not hold a degree, and the ability of the other spouse to pay alimony.
Are pensions subject to equitable distribution in a divorce?
Pensions are absolutely subject to equitable distribution. A pension is usually one of the most valuable asset that a couple has. The funds from a pension that are acquired during the marriage are subject to equitable distribution regardless of when they vest. Public policy states that to insure the support of a financially depended spouse, a statute prohibiting attachments should not intervene in providing support for a dependent spouse.
The issue of whether the pension constitutes property acquired during the marriage is highly relevant issue to equitable distribution. Both parties contribute to earnings of one spouse's pension by their participation in the marriage and both expect to share in the future enjoyment of that pension benefit.
How are pensions divided and split up in a divorce?
There are essentially two methods of distribution of a pension in a divorce case. The two methods to split up a pension are a (1) deferred benefit share and (2) immediate offset distribution against the other assets. A deferred benefit share postpones distribution until a pension comes into pay status. An offset distribution trades off the present value of the pension interest against a current asset which is given to him/her in satisfaction of his/her share of a pension.
Basically, in a divorce case, the parties are eoncouraged to hire an actuary to value a pension and to prepare the necessary court orders to divide it. Most pensions are split up by a very complicated procedure. In summary, a Qualified Domestic Relations Order, commonly called a QDRO, must be prepared to split up the pension. In most cases, the parties equally split the costs of preparing the QDRO. Once the proposed QDRO order is obtained, then is it sent to the court. The court will then sign the order and certify it. Once the order is certified, it must be sent to the plan administrator of the pension, who will distribute the pension according to the terms of the QDRO. It is very important to have the QDRO carefully drafted and prepared. A poorly drafted QDRO can be a disaster, and can result in adverse income tax consequences.
Is a severance package subject to equitable distribution?
A pre-retirement benefit package received by a spouse after a divorce complaint was filed, but representing in whole or in part a deferred compensation for services provided during the course of the marriage, is subject to equitable distribution. The key question is whether the "benefit" represented deferred compensation based upon the spouses previous endeavors during the marriage. For example, severance pay may be determined by an employee's skills during his/her employment at a company. This, then would be subject to equitable distribution because both parties would have contributed to the employed spouse success in his or her care. Severance pay may also be considered for past labor. Payment for vacation day may accrue during the marriage and it must also be considered under equitable distribution. Finally, commissions upon departure from a company are also considered deferred compensation for previous endeavors.
If my case goes to trial, and if I disagree with the Judge's decision regarding the equitable distribution of property, do I have any rights?
Yes. In every case, the court is required to make specific findings of fact on the evidence relative to all issues pertaining to asset eligibility or ineligibility, asset valuation, and equitable distribution, including the factors listed above. If you have a good faith belief that the judge either didn't consider a specific factor that is important, or misapplied a factor to the facts of your case, and you might consider filing an appeal to the Appellate Division.
Please keep in mind that the odds of winning your appeal are only about one in four. Moreover, appeals can be very expensive. The filing fees are very high. Moreover, a person who appeals also has to pay for the transcripts of the divorce proceedings. The cost of transcripts are very high. Finally, if your appeal is not strong, then you may be required to pay for your ex-spouse's legal fees to contest the appeal. In summary, before anyone appeals, he or she must carefully consider that there is a downside to an appeal. Moreover, the odds of winning an appeal are only about 25%.
